EFTA00902833.pdf

From: "Barrett, Paul S" To: Jeffrey Epstein <jeevacation@gmail.com> Subject: FW: Apple Inc. : Stock Radar: Expect More Appreciation Potential in Shares of Apple as iPhone and iPad Soar; Lifting Dec-I I Price Target to $450 Date: Tue, 25 Jan 2011 15:39:31 +0000 Attachments: Applelnc.pdf Inline-Images: JPM_Iogo.gif; spacer.gift email_alert_icon.gif; image001.png Jeffrey I think we should buy $3MM worth of AAPL. We raised our px target to $450.00. Paul Barrett, CFA Managing Director Global Investment Opportunities Group 7PMorgan Private Bank 40W 57th Street, 3 York, NY 10019 :W) (F) From: JPMorgan.Research.Alerts@jpmorgan.com [mallto:JPMorgan.Research.Alerts@jpmorgan.com] Sent: Tuesday, January 25, 2011 10:14 AM To: Barrett, Paul S Subject: Apple Inc. : Stock Radar: Expect More AppredatIon Potential in Shares of Apple as iPhone and iPad Soar; Lifting Dec-11 Price Target to $450 MorganMarkets Research Email Alerts pi You are receiving this email because you requested the following J.P. Morgan Research using the MorganMarkets Adhoc email feature. This is not a subscription and will not cause any other emails to be sent to you. Headline: Apple Inc.: Stock Radar: Expect More Appreciation Potential in Shares of Apple as iPhone and iPad Soar Lifting Dec-11 Price Target to $450 Author(s): Mark Moskowitz. Anthony Luscri, Mike Kim Abstract: • Shares of Overweight-rated Apple should exhibit upward momentum following the strong F1O11 results. While the news of CEO Steve Jobs taking another medical leave could inject some uncertainty into Apple shares, we believe that the strong print-and-guide should begin to refocus investors on Apples unrivaled growth story and its staying power. Apple is one of our top picks for 2011. • Expected stock movement: going up. We are lifting our Dec-11 price target to $450 from $420. The below-mentioned "scorecard- and -recommended homework" indicate that investor sentiment stands to drive a positive valuation re-rating, particularly as we expect Apple's growth profile to be unrivaled in large cap tech. Drivers include Apple's break-out performances in iPhone. iPad. and Asia-Pacific. • Results recap: Apple posts strong F1Q11 results. Apple beat our above-consensus revenue and EPS estimates. We had previewed the prospects of the iPhone and iPad delivering significant upside for the December quarter in our -pre-earnings radar report. The company more than delivered. We are lifting our estimates and expect a series of number hikes. We expect the iPhone. iPad. and Mac to drive above-peer growth over the next 2-3 years. • Bulls vs. Bears scorecard: Bulls win again. Apple's results and guidance continue to exhibit upside momentum. Unit shipments of iPhones and iPads came in well above EFTA00902833  expectations. In particular, iPhone and iPad units of 16.2M and 7.3M beat consensus estimates of 15.5M and 6.9M. Asia-Pacific stood out as a major contributor as Mac revenue in the region increased 67% YoY and iPhone revenues more than doubled. Overall, Asia• Pacific revenues increased 175% YoY. Gross margins also impressed at 38.5%. • Recommended homework. We expect investors to focus on Apple's ability to retum gross margins to the 39-40% threshold over time. Also, investors stand to evaluate the sustainability of Apple's early lead in the tablet market relative to competitive tablet offerings expected late this year. Lastly, expected iPhone momentum at Verizon will be an important topic, as well as Apple's ongoing penetration of the "Target Zone" of the PC market internationally, which we believe is just getting started. Link: mI ps://mmjpmorgan.com/PubScrvIct?actionecmail&docr,GPS-532380-0.pdf If you wish to change your J.P. Morgan Email Alert preferences click here or unsubscribe https://mm.jpmorgan.com/MorganMarkets?page=my alerts. MorganMarkets, J.P. Morgan's research and market data portal, provides a single point of access to the firm's award- winning research across all asset classes, plus analytics, market data and proprietary tools. With MorganMarkets, you will have 2417 access to the actionable ideas, strategy recommendations and analysis that truly distinguish J.P. Morgan as the leader in investment research. Copyright © 1999, 2010 JPMorgan Chase 8, Co. All Rights Reserved. This email alert is sent only to authorized J.P. Morgan clients and is for informational purposes only. This email alert may contain hyperlinks and/or attachments to J.P. Morgan research that you requested. Additional information available upon request. This email alert may not be forwarded or distributed to any other person and may not be reproduced in any manner whatsoever. It is not intended as an offer or solicitation for the purchase or sale of any financial instrument or as an official confirmation of any transaction. Access to the research described herein is made available only to authorized J.P. Morgan clients with a valid ID and password to the MorganMarkets website. The research referred to in this email alert is made available globally by J.P. Morgan Securities LLC, J.P. Morgan Futures Inc., J.P. Morgan Securities Ltd., J.P. Morgan plc, J.P. Morgan Europe Limited or their affiliates as designated via the MorganMarkets website. All market prices, data and other information are not warranted as to completeness or accuracy and are subject to change without notice.My comments or statements made herein do not necessarily reflect those of JPMorgan Chase & Co., its subsidiaries and affiliates. J.P. Morgan's Full Disclaimechttps://mm.jumorgan.com/disclosures/company/index.htrnl This email is confidential and subject to important disclaimers and conditions including on offers for the purchase or sale of securities, accuracy and completeness of information, viruses, confidentiality, legal privilege, and legal entity disclaimers, available at http://wwwjpmorgan.corn/pages/disclosures/email. EFTA00902834